Versabank (VBNK) AI Stock Analysis

• Market Cap: C$665.43M
• Dividend Yield: 0.49%
• Average Volume (3M): 22.00K
• Price to Earnings (P/E): 23.3
• Beta (1Y): 1.42
• Revenue Growth: 3.31%
• EPS Growth: -39.12%
• Country: CA
• Employees: 121
• Sector: Financial
• Sector Strength: 70
• Industry: Banks - Regional
• EPS (TTM): 0.33
• Shares Outstanding: 31,945,536
• 10 Day Avg. Volume: 37,575
• 30 Day Avg. Volume: 21,998
• PEG Ratio: -0.47
• Price to Book (P/B): 0.99
• Price to Sales (P/S): 1.73
• P/FCF Ratio: 3.53
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: C$19.05
• Price Target Upside: -8.53% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2
• EPS Forecast (FY): 1.88
• Revenue Forecast (FY): C$145.96M

• Rating: 67 Neutral
• Price Target: C$22.00 ▲(5.62% Upside)

Versabank's strong financial performance, characterized by consistent revenue growth and robust cash flow, is a key strength. However, technical indicators suggest the stock may be overbought, and its valuation appears high relative to peers. These factors contribute to a balanced overall score, reflecting both opportunities and risks.

Positive Factors

Revenue Growth

Versabank's revenue growth of 29% YoY indicates strong market demand and effective business strategies, enhancing its competitive position.

Market Expansion

Expansion in the US and Canada, especially in the RPP portfolio, suggests significant growth potential and increased market penetration.

Operational Efficiency

Improved operational efficiency through cloud-based operations enhances scalability and cost management, supporting long-term profitability.

Negative Factors

Profit Margin Pressure

Decreasing profit margins indicate rising costs or pricing pressures, which could impact long-term profitability if not addressed.

Declining Return on Equity

A declining return on equity suggests challenges in generating returns for shareholders, potentially affecting investor confidence.

Net Profit Margin Decline

A declining net profit margin indicates challenges in maintaining profitability, which could hinder future financial performance.

Versabank Business Overview & Revenue Model

Company Description

VersaBank, a schedule I chartered bank, provides various banking products and services in Canada. The company offers deposit products, such as guaranteed investment certificates, registered retirement savings plans, daily interest savings accounts, and tax-free savings accounts, as well as deposit insurance products. It also provides lending services, including point of sale financing that involves purchasing loan and lease receivables from finance companies operating in various industries; and commercial banking services comprising commercial real estate, public sector/infrastructure financing, condominium financing, and residential mortgages. The company was formerly known as Pacific & Western Bank of Canada and changed its name to VersaBank in May 2016. VersaBank was incorporated in 1979 and is headquartered in London, Canada.

How the Company Makes Money

Versabank generates revenue primarily through interest income from loans and advances made to customers. This includes personal loans, mortgages, and commercial lending. Additionally, the bank earns income from fees associated with its various banking services, including transaction fees, account maintenance fees, and payment processing services. Versabank's revenue model is further bolstered by its partnerships with technology firms and fintech companies, which enable it to offer enhanced digital services and attract a broader customer base. The bank's focus on low-cost, efficient operations also contributes to its profitability, allowing it to maintain competitive interest rates while maximizing margins.

Versabank Financial Statement Overview

Summary

Versabank demonstrates a solid financial position with consistent revenue growth and a stable balance sheet. While profitability margins have faced pressure, the company maintains operational efficiency. The strong cash flow generation supports its financial health, although the declining return on equity and net profit margin warrant attention.

Income Statement

Versabank has shown consistent revenue growth over the years, with a notable increase in total revenue from 2020 to 2025. However, the gross profit margin has decreased from 2020, indicating rising costs or pricing pressures. The net profit margin has also declined, suggesting challenges in maintaining profitability. Despite these issues, the company has managed to maintain a positive EBIT and EBITDA margin, reflecting operational efficiency.

Balance Sheet

The debt-to-equity ratio has remained relatively stable, indicating a balanced approach to leveraging. However, the return on equity has decreased over the years, which may concern investors seeking high returns. The equity ratio is strong, suggesting a solid capital structure and financial stability.

Cash Flow

Versabank's cash flow position has improved significantly, with positive free cash flow growth and a high free cash flow to net income ratio. The operating cash flow to net income ratio is low, indicating potential challenges in converting income into cash. Overall, the cash flow metrics suggest a strong ability to generate cash, which is crucial for sustaining operations and growth.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	304.15M	294.40M	237.92M	132.54M	94.69M
Gross Profit	120.23M	111.63M	108.03M	81.94M	65.80M
EBITDA	44.59M	57.43M	59.43M	34.49M	32.52M
Net Income	28.46M	39.75M	42.16M	22.66M	22.38M
Balance Sheet
Total Assets	5.81B	4.84B	4.20B	3.27B	2.42B
Cash, Cash Equivalents and Short-Term Investments	582.66M	226.21M	133.19M	89.53M	271.52M
Total Debt	106.18M	108.58M	110.62M	109.42M	100.39M
Total Liabilities	5.28B	4.44B	3.82B	2.92B	2.08B
Stockholders Equity	532.67M	399.20M	377.16M	350.68M	332.11M
Cash Flow
Free Cash Flow	149.44M	254.13M	94.36M	-33.23M	-108.32M
Operating Cash Flow	150.40M	272.70M	94.72M	-32.65M	-108.31M
Investing Cash Flow	212.26M	-157.58M	-28.14M	-141.61M	-8.44M
Financing Cash Flow	102.04M	-23.33M	-17.31M	-6.30M	131.40M

Versabank Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 20.83
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:VBNK, the sentiment is Positive. The current price of 20.83 is above the 20-day moving average (MA) of 20.07, above the 50-day MA of 18.01, and above the 200-day MA of 16.20, indicating a bullish trend. The MACD of 0.81 indicates Positive momentum. The RSI at 72.63 is Negative, neither overbought nor oversold. The STOCH value of 52.70 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:VBNK.

Versabank Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AI	70 Outperform	C$559.40M	11.21	9.72%	7.95%	-13.69%	-1.60%
MKP	69 Neutral	C$912.62M	13.65	10.50%	7.33%	7.74%	-31.96%
TF	68 Neutral	C$581.76M	15.43	5.52%	10.00%	-9.00%	-35.22%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
VBNK	67 Neutral	C$665.43M	23.28	6.08%	0.49%	3.31%	-39.12%
EQB	65 Neutral	$3.87B	15.61	8.72%	2.09%	-7.50%	-34.45%
LB	62 Neutral	C$1.78B	14.06	5.11%	4.67%	-11.26%	―

Versabank Corporate Events

VersaBank Supports Salvation Army’s Fight Against Food Insecurity with $50,000 Donation

VersaBank has announced a $50,000 donation to The Salvation Army’s Harvest Hope campaign to combat food insecurity across Canada, particularly in London, Ontario, where the bank is headquartered. This contribution comes at a crucial time as food bank usage has significantly increased, highlighting the importance of corporate support in addressing urgent community needs. VersaBank’s President, David Taylor, emphasized the impact of The Salvation Army’s services and called on other business leaders to contribute to their communities, underscoring the bank’s commitment to social responsibility.

The most recent analyst rating on (TSE:VBNK) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Versabank stock, see the TSE:VBNK Stock Forecast page.

VersaBank Enhances CMHC Lending Program to Boost Revenue

VersaBank has announced an enhancement to its Canadian Mortgage and Housing Corporation (CMHC) insured lending program, which is expected to generate at least $2 million in incremental revenue in fiscal 2026 with minimal additional costs. This initiative aligns with the Canadian government’s increased support for multi-residential housing, as outlined in the 2025 Federal Budget, which raises the Canadian Mortgage Bond issuance limit. This expansion provides VersaBank with further opportunities to capitalize on its Enhanced CMHC Program, potentially increasing its market presence and profitability.

The most recent analyst rating on (TSE:VBNK) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Versabank stock, see the TSE:VBNK Stock Forecast page.

VersaBank Supports Canadian Stablecoin Regulation, Eyes New Revenue Streams

VersaBank has expressed support for the Canadian government’s planned regulation of stablecoins, which is expected to create new revenue opportunities for the bank as it advances the commercialization of its proprietary tokenized deposit solutions. The bank has initiated collaborations with stablecoin issuers to develop SOC2 Type 1-certified custody solutions, leveraging its VersaVault® technology to provide secure digital asset storage. This move positions VersaBank as a leader in the emerging digital asset custody market, potentially enhancing its industry standing and offering significant advantages to stakeholders through its regulated and secure digital banking solutions.

The most recent analyst rating on (TSE:VBNK) stock is a Hold with a C$17.00 price target. To see the full list of analyst forecasts on Versabank stock, see the TSE:VBNK Stock Forecast page.

VersaBank to Join KBW Fintech Payments Conference in NYC

VersaBank announced its participation in the KBW Fintech Payments Conference in New York City from November 11-13, 2025, where management will engage in one-on-one meetings. This participation underscores VersaBank’s strategic focus on expanding its influence in the fintech and digital banking sectors, highlighting its commitment to innovation and growth in the North American market.

The most recent analyst rating on (TSE:VBNK) stock is a Buy with a C$19.00 price target. To see the full list of analyst forecasts on Versabank stock, see the TSE:VBNK Stock Forecast page.